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$2,250,000,000 Senior Credit Facilities Amendment Letter - HCA INCTN - 10-25-2004

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$2,250,000,000 Senior Credit Facilities Amendment Letter - HCA INCTN - 10-25-2004 Powered By Docstoc
					  

                                                                                               EXHIBIT (b)(5)

(JPMORGAN LOGO)

                                                                                              October 21, 2004 

                                    $2,250,000,000 Senior Credit Facilities

                                               Amendment Letter

HCA Inc.
One Park Plaza
Nashville, Tennessee 37203
              
Attention: David G. Anderson
             Senior Vice President, Finance & Treasurer

Gentlemen:

     Reference is made to the Commitment Letter dated October 12, 2004 (including the Term Sheet attached 
thereto, the “Commitment Letter”) between us and you, regarding the $1,750,000,000 revolving credit facility
and $500,000,000 term loan facility described therein. Capitalized terms used but not defined herein are used
with the meanings assigned to them in the Commitment Letter.

     We have agreed that the Commitment Letter is hereby amended by replacing the Term Sheet attached thereto 
as Exhibit A with the Statement of Terms and Conditions attached hereto as Exhibit A (the “Revised Term
Sheet”). All references to the “Term Sheet” contained in the Commitment Letter and in any related documents
hereafter shall be deemed to refer to the Revised Term Sheet. Except as amended hereby, the Commitment
Letter shall continue in full force and effect in all respects and is hereby ratified and confirmed.
  

                                                        -2-

HCA Inc.

     Please confirm that the foregoing is our mutual understanding by signing and returning to us an executed 
counterpart of this Amendment Letter.

  

                                                 Very truly yours,
                                                                 
                                                         J.P. MORGAN SECURITIES INC.

                                                                  

                                                            By: /s/ Andrew T. Brode

                                                                 Name: Andrew T. Brode
                                                                 Title: Vice President
  
                                                                  
                                                          JPMORGAN CHASE BANK

                                                                  

                                                            By: /s/ Dawn Leelum

                                                                 Name: Dawn Leelum
                                                                 Title: Vice President
  

Accepted and agreed to as of
the date first above written:

HCA INC.
            
   By:    /s/ Keith M. Giger

         Name: Keith M. Giger
         Title: Vice President - Finance
  

(JPMORGAN LOGO)

                                                                                              EXHIBIT A

                                          HCA INC.

                      $2,250,000,000 SENIOR CREDIT FACILITIES

                              Statement of Terms and Conditions
                             
BORROWER:                  HCA Inc., a Delaware corporation (the “Borrower”).
  
AMOUNT AND                 Five-year revolving credit facility (the “Revolving Facility”) in the amount of
TYPE OF FACILITIES:        $1,750,000,000.
  
                           Five-year term loan facility (the “Term Loan Facility”; together with the
                           Revolving Facility, the “Facilities”) in an aggregate principal amount of
                           $500,000,000. The Term Loan Facility shall be repayable in 16 consecutive
                           quarterly installments, commencing on March 31, 2006 and ending on the 
                           date that is five years after the Closing Date, in an aggregate amount for each
                           12-month period set forth below equal to the amount set forth opposite such
                           period (with installments during each such period being equal in amount):
  
                                                            
                           Period          Principal Amount
                                     
                            Year
                               1                  —        
                            Year
                               2           $ 50,000,000  
                            Year
                               3           $ 75,000,000  
                            Year
                               4           $125,000,000  
                            Year
                               5           $250,000,000  
                              
                             
PURPOSE:                   For refinancing the existing outstandings under the Credit Agreement (the
                           “Existing Credit Agreement”), dated as of April 30, 2001, among the 
                           Borrower, the Banks (as defined therein), the Co-Agents (as defined
                           therein), the Senior Managing Agents (as defined therein), the Managing
                           Agents (as defined therein), the Lead Managers (as defined therein) and the
                           Agent (as defined therein), and for general corporate purposes (including but
                           not limited to the redemption or purchase of outstanding securities of the
                           Borrower).
  
SOLE ADVISOR, LEAD
ARRANGER AND
BOOKRUNNER:                JPMorgan Securities Inc. (“JPMorgan”)
  
ADMINISTRATIVE
AGENT:                     JPMorgan Chase Bank (“JPMCB”).

                                                 3
  

                                                                                                       2
                            
LENDERS:                  A syndicate of banks and other financial institutions including JPMCB,
                          arranged by JPMorgan (collectively, the “Lenders”).
  
AVAILABILITY:             The proceeds of the Term Loan Facility will be advanced in a single drawing
                          on the Closing Date. The Revolving Facility shall be available on a revolving
                          basis during the period commencing on the Closing Date and ending on the
                          fifth anniversary thereof (the “Revolving Termination Date”).
  
LETTERS OF CREDIT:        A portion of the Revolving Facility not in excess of $250,000,000 shall be
                          available for the issuance of letters of credit (the “Letters of Credit”) by
                          JPMCB (in such capacity, the “Issuing Lender”). No Letter of Credit shall
                          have an expiration date after the earlier of (a) one year after the date of 
                          issuance and (b) five business days prior to the Revolving Termination Date, 
                          provided that any Letter of Credit with a one-year tenor may provide for the
                          renewal thereof for additional one-year periods (which shall in no event
                          extend beyond the date referred to in clause (b) above). 
  
                          Drawings under any Letter of Credit shall be reimbursed by the Borrower
                          (whether with its own funds or with the proceeds of Revolving Loans) on the
                          next succeeding business day following notice to the Borrower of such
                          drawing. To the extent that the Borrower does not so reimburse the Issuing
                          Lender, the Lenders under the Revolving Facility shall be irrevocably and
                          unconditionally obligated to reimburse the Issuing Lender on a pro rata basis.
  
COMPETITIVE LOANS:        The Borrower shall have the option to request that the Lenders bid for loans
                          (“Competitive Loans”) bearing interest at a stated rate or a margin over the
                          eurodollar rate, with specified maturities ranging from 7 to 360 days. Each 
                          Lender shall have the right, but not the obligation, to submit bids at its
                          discretion. The Borrower, by notice given four business days in advance in
                          the case of eurodollar rate bids and one business day in advance in the case
                          of stated rate bids, shall specify the proposed date of borrowing, the interest
                          period, the amount of the Competitive Loan and the maturity date thereof,
                          the interest rate basis to be used by the Lenders in bidding and such other
                          terms as the Borrower may specify. The Agent shall advise the Lenders of
                          the terms of the Borrower’s notice, and, subject to acceptance by the
                          Borrower, bids shall be allocated to each Lender in ascending order from the
                          lowest bid to the highest bid acceptable to the Borrower. While Competitive
                          Loans are outstanding, the available commitments under the Revolving
                          Facility shall be reduced by the aggregate amount of such outstanding
                          Competitive Loans.
  
  

                                                                                                                 3
                             
FEES AND
INTEREST RATES:            As set forth on Annex I.
  
NOTICE OF                  The Borrower must provide notice to the Agent prior to any proposed
BORROWING:                 borrowing under the Facilities as follows:
  
                           Eurodollar Loans: three business days
                           ABR Loans: same business day
  
OPTIONAL                   ABR Loans may be prepaid at any time without penalty. Eurodollar Loans may
PREPAYMENTS:               be prepaid on the last day of the relevant interest period or at any time, subject
                           to “breakage cost” reimbursement. Partial prepayments of Loans shall be in
                           minimum amounts of $5,000,000 or a whole multiple of $1,000,000 in excess
                           thereof.
  
RESERVE                    The rate quoted as Eurodollar Rate will be grossed-up for the maximum
REQUIREMENTS;              reserve requirements then in effect for eurocurrency liabilities. In addition, the
YIELD PROTECTION:          definitive financing agreement will contain customary provisions relating to
                           increased costs, capital adequacy protection, withholding and other taxes and
                           illegality. Such provisions will be substantially similar to those set forth in the
                           Existing Credit Agreement.
  
REPRESENTATIONS
AND WARRANTIES;
CONDITIONS
PRECEDENT;
AFFIRMATIVE AND            Substantially similar to those set forth in the Existing Credit Agreement except
NEGATIVE                   that the ratio of consolidated total debt to consolidated total capitalization will
COVENANTS; EVENTS          be 75% from the Closing Date until March 30, 2006, 70% from March 31, 
OF DEFAULT:                2006 until March 30, 2007 and 65% from March 31, 2007 and thereafter. 
  
CONDITIONS                 The availability of the Facilities will be conditioned upon conditions substantially
PRECEDENT                  similar to those in the Existing Credit Agreement and satisfaction of the
                           following conditions precedent as of the Closing Date:
  

                         (a)   The Administrative Agent shall have received evidence reasonably
                               satisfactory to the Administrative Agent that the Existing Credit Agreement
                               shall have been terminated (other than any outstanding letters of credit which
                               will roll over into the new facility); and
  

                                                                                                       4

                   (b)   A minimum long-term unsecured debt rating for the Borrower from S&P and
                         Moody’s of at least BB+ and Ba2, respectively (with a stable outlook).
                       
ASSIGNMENTS AND      The Borrower may not assign its rights or obligations under the Facilities without
PARTICIPATIONS:      the prior written consent of the Lenders.
  
                     The Lenders shall be permitted to sell participations in loans, notes and
                     commitments; provided that, such Lender’s obligations under the Facilities shall
                     remain unchanged. Participations shall be subject to further qualifications
                     substantially similar to those in the Existing Credit Agreement.
  
                     The Lenders shall be permitted to assign all or any part of their respective rights
                     or obligations (or Notes, if applicable) under the facilities; provided that, in the
                     case of an assignment to a bank which is not a Lender or an affiliate of a Lender,
                     such assignment is subject to the consent of both the Borrower (unless an Event
                     of Default has occurred and is continuing) and the Agent (which consent shall
                     not be unreasonably withheld); and provided further that, in the case of
                     assignment to bank which is not a Lender or an affiliate of a Lender, (i) such 
                     assignment is subject to a minimum amount of $2,500,000 or such lesser amount
                     as may be agreed upon by the Borrower and the Agent and (ii) the transferor 
                     Lender shall retain a minimum Commitment after giving effect to such assignment
                     of $5,000,000 or such lesser amount as may be agreed upon by the Borrower
                     and the Agent. Assignees will have all the rights and obligations of the assignor
                     Lender. Each assignment will be subject to the payment of a service fee payable
                     by the assignee and/or the assignor to the Agent. The voting rights for
                     participants will be limited to changes in amount, tenor and rate.
  
EXPENSES:            All reasonable legal, syndication, and out-of-pocket expenses of JPMorgan,
                     JPMCB and their counsel, Simpson Thacher & Bartlett LLP, are for the
                     account of the Borrower.
  
CLOSING DATE:        The date on which the definitive agreements have been executed and delivered
                     and the proceeds of the Term Loan Facility have been advanced to or for the
                     account of the Borrower, which is expected to be not later than November 19, 
                     2004.
  
GOVERNING LAW:       State of New York.
  

                                                                                              ANNEX I

                             INTEREST AND CERTAIN FEES
                                 
Interest Rate Options:         The Borrower may elect that the Loans (other than Competitive Loans)
                               comprising each borrowing bear interest at a rate per annum equal to
                               (i) the ABR plus the Applicable Margin or (ii) the Eurodollar Rate plus 
                               the Applicable Margin.
  
                               As used herein:
  
                               “ABR” means the highest of (i) the rate of interest publicly announced by
                               JPMCB as its prime rate in effect at its principal office in New York
                               City (the “Prime Rate”), (ii) the secondary market rate for three-month
                               certificates of deposit (adjusted for statutory reserve requirements) plus
                               1% and (iii) the federal funds effective rate from time to time plus 0.5%. 
  
                               “Applicable Margin” means a percentage determined in accordance with
                               the pricing grid attached hereto as Annex I-A.
  
                               “Eurodollar Rate” means the rate (adjusted for statutory reserve
                               requirements for eurocurrency liabilities) for eurodollar deposits for a
                               period equal to one, two, three or six months (as selected by the
                               Borrower) (or nine or twelve months with the consent of the Lenders)
                               appearing on Page 3750 of the Telerate screen.
  
Interest Payment Dates:        In the case of Loans bearing interest based upon the ABR (“ABR
                               Loans”), quarterly in arrears.
  
                               In the case of Loans bearing interest based upon the Eurodollar Rate
                               (“Eurodollar Loans”), on the last day of each relevant interest period
                               and, in the case of any interest period longer than three months, on each
                               successive date three months after the first day of such interest period.
  
Facility Fees:                 The Borrower shall pay a facility fee calculated at a rate per annum
                               determined in accordance with the pricing grid attached hereto as Annex
                               I-A on the average daily total Revolving Facility, payable quarterly in
                               arrears.
  
Letter of Credit Fees:         The Borrower shall pay a fee on all outstanding Letters of Credit at a
                               per annum rate equal to the Applicable Margin then in effect with
                               respect to Eurodollar Loans under the Revolving Facility on the face
                               amount of each such Letter of Credit. Such fee shall be shared ratably
                               among the
  

                             
                           Lenders participating in the Revolving Facility and shall be payable
                           quarterly in arrears.
  
                           A fronting fee equal to 0.125% per annum on the face amount of each
                           Letter of Credit shall be payable quarterly in arrears to the Issuing
                           Lender for its own account. In addition, customary administrative,
                           issuance, amendment, payment and negotiation charges shall be payable
                           to the Issuing Lender for its own account.
  
Default Rate:              At any time when the Borrower is in default in the payment of any
                           amount of principal due under the Facilities, any such amount shall bear
                           interest at 2% above the rate otherwise applicable thereto. Any overdue
                           interest or other amount payable shall bear interest at 2% above the rate
                           applicable to ABR Loans, in each case from the date of such non-
                           payment until paid in full.
  
Rate and Fee Basis:        All per annum rates shall be calculated on the basis of a year of
                           360 days (or 365/366 days, in the case of ABR Loans the interest rate 
                           on which is then based on the Prime Rate) for actual days elapsed.
  

                                                                                                                      ANNEX I-A

                                                    PRICING GRID

                                                    Revolving Facility
                                                                                                                                  
                                               Level I          Level II           Level III          Level IV            Level V
                                                                                                                   
Applicable Margin:                                                                                                               
 ABR Loans                                     0.000%            0.000%            0.000%              0.000%             0.000%
 Eurodollar Loans                              0.400%            0.500%            0.600%              0.800%             1.000%
Applicable Margin for Facility Fee:            0.100%            0.125%            0.150%              0.200%             0.250%

                                                    Term Loan Facility
                                                                                                                                  
                                               Level I          Level II           Level III          Level IV            Level V
                                                                                                                   
Applicable Margin:                                                                                                               
 ABR Loans                                     0.000%            0.000%            0.000%              0.000%             0.250%
 Eurodollar Loans                              0.500%            0.625%            0.750%              1.000%             1.250%

     The Applicable Margin shall not be less than that for Level IV or, if Level V otherwise would be applicable, 
then that for Level V, for the period beginning on the Closing Date and ending on the date that is six months after
the Closing Date.

     Level I Period: any period during which the publicly announced ratings by S&P and Moody’s of the then
current senior unsecured, non-credit enhanced, long-term indebtedness of the Borrower that has been publicly
issued are BBB+ or better and Baa1 or better, respectively.

     Level II Period: any period during which the publicly announced ratings by S&P and Moody’s of the then
current senior unsecured, non-credit enhanced, long-term indebtedness of the Borrower that has been publicly
issued are BBB and Baa2, respectively.

     Level III Period: any period during which the publicly announced ratings by S&P and Moody’s of the then
current senior unsecured, non-credit enhanced, long-term indebtedness of the Borrower that has been publicly
issued are BBB- and Baa3, respectively.

     Level IV Period: any period during which the publicly announced ratings by S&P and Moody’s of the then
current senior unsecured, non-credit enhanced, long-term indebtedness of the Borrower that has been publicly
issued are BB+ and Ba1, respectively.

     Level V Period: any period during which the publicly announced ratings by S&P and Moody’s of the then
current senior unsecured, non-credit enhanced, long-term indebtedness of
  

     the Borrower that has been publicly issued is equal to or below BB or unrated and equal to or below Ba2 or 
unrated, as the case may be.

     provided, that if on any day the ratings by S&P and Moody’s do not coincide for any rating category and the
Level differential is (x) one level, then the higher rating will be the applicable Level; (y) two or more levels, the 
Level that is one level higher than the lowest rating will be the applicable Level.